We Americans are watching the events unfold in Iraq with great trepidation. Rising terrorism and rising energy prices. Déjà vu all over again.
And gold is reacting, soaring like a bat out of hell. Up more than $50 last Thursday alone.
A huge move reminiscent of the blastoff phase in late 1978 when gold exploded from a low of $193.40 in November to a high of $875 in January 1980 — a parabolic 352 percent move higher in the price of gold in a tad over two short years.
Thus far for June, gold is up an amazing $82, almost 6.7 percent. Mining shares are doing even better, with the ARCA Gold Bugs Index up 16.7 percent.
The chart shows Basket of gold miners up 16.7% in 20 days— while some of my favorite miners are up even more, as much as 40% in 20 days.
These are real moves. More importantly, they are market moves that tell you that it’s not just us Americans who are worried about the world and starting to buy gold again. The entire investment community — and anyone in their right mind — is worried.
That’s not surprising, considering the sorry state of affairs the world is embarking upon.
It’s not surprising, considering that I have warned you repeatedly of the ramping up of the war cycles. Cycles that govern human social interaction on a grand scale, cycles that can be quantified and used to forecast periods of peace and war, periods of civil unrest and international conflict.
And those cycles are now ramping up and converging in the worst possible combination of forces not seen since the late 1800s.
These are the cycles that are responsible for all that you are now seeing …
– Russia versus Ukraine and other former Soviet satellites, versus Europe and the U.S.
– The reign of terror by the Islamic State in Iraq and Syria (ISIS) in Iraq. This group of terrorists is so violent andextreme that they were kicked out of Al-Qaeda. And now they are the most well-funded terror group in the world with nearly $500 million in the bank and they are ravaging Iraq and headed on to Jordan and other Middle Eastern countries.
– Nigeria, where Boko Haram Islamists have killed hundreds of villagers and kidnapped hundreds of women by posing as Nigerian soldiers, rounding everyone up, and opening fire.
– Kenya, where the Al-Qaeda affiliate Al-Shabab terrorist group is responsible for the recent bloodbath that took place in Mpekeoni, a well-known tourist area. And where nine more people have been massacred by Islamic extremists and Al-Shabab in the coastal areas … and an additional 48 World Cup fans were killed in Mpeketoni.
– Pakistan, where more than 70,000 civilians are now homeless refugees, fleeing from government troops who killed 105 militants in North Waziristan’s Shawal area.
– Canada, where a Calgary suicide bomber who killed 19 Iraqis has become a propaganda tool for jihadists, who are urging Muslims to follow his “great example” and threatening Canada to change its “oppressive” foreign policies.
– China, where the Chinese government recently executed 13 people in the Xinjiang region who were found guilty of organizing and leading terrorist groups, as well as murder, arson, theft and other crimes.
– China versus Japan, Vietnam, Indonesia, Malaysia, the Philippines, in an international dispute over the Spratly and Senkaku Islands and their vast oil and gas reserves … and where China is claiming territorial jurisdiction, seizing land and waters away from countries, a dispute that will ultimately lead to an international war.
– Then there’s Syria, Yemen, Egypt, Turkey, Iran, North Korea, Venezuela, Myanmar, Libya, and a host of other countries where violence is rapidly rising.
All told, there are now a record 61 countries involved in wars and 540 militia, anarchist, religious and separatist groups.
And lest you think the turmoil you are seeing is all terrorist-related, or isolated events that do not impact you, think again:
The rising war cycles are also about bankrupt, destitute governments that are now acting like caged animals, striking out against their own people …
By raising taxes, engaging in confiscatory wealth measures and capital controls, by spying on their own citizens and more.
– Last March’s Cyprus confiscation of depositor wealth to bail out Cyprus’ banks, a policy that has now been embraced and legalized for all of Europe. Have money in a European bank? Good luck, if it goes under, your money is at risk of being confiscated.
– Last September’s confiscation of retirement accounts by Poland’s government. Fully half of all private retirement assets transferred to the state without offering retirees any compensation whatsoever.
– France’s SEVENTY-FIVE percent income tax. And to counter, where France’s Marine Le Pen’s Front National is championing a recent report by well-known French economists that concluded that 60 percent of French public debt is illegitimate, sowing the seeds for a French sovereign debt default down the road.
– Argentina, where massive sovereign debts are now unpayable, and confiscatory measures against pensions are now in the planning stage by President Cristina Kirchner.
– Or Washington’s incessant spying on YOU, all designed to track everything you do, every penny you spend or squirrel away.
In short, all over the globe the rising tide of geo-political unrest is occurring at a pace at which even I underestimated.
You may think all these conflicts are unrelated … or the
result of religious extremists … or that they have no impact on you.
But mark my words: Look closely, as I have done, at all of the conflicts around the world — whether religiously inspired or not — and you will see two common threads:
1. Private sector groups rising up against authoritarian, unjust, corrupt and imperialist governments.
2. Private sector groups rising up against governments that want to increase taxes or even confiscate wealth while, at the same time, levying austerity measures on its people to slash previously promised benefits.
In lesser developed countries, it’s the result of government corruption, imperialistic actions taken by developed countries, pillaging of natural resources, and more. Yes, they are shrouded in religious, especially Islamic extremism …
But when distilled down to the truth, the forces driving them are no different than the forces that are driving the civil and international unrest you are now seeing in developed countries.
It’s merely a matter of degree. Yet an impartial and objective study of the forces that are driving the war cycles higher — wherever in the world they are playing themselves out …
Can all be distilled down to a great battle between the public and the private sectors.
These are the chief reasons gold and
silver are now starting to explode higher.
And why gold will likely fetch well over $5,000 an ounce a few years from now … silver to more than $125 an ounce … and mining shares, to the moon.
Best wishes and stay tuned,
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